What would be the best way to round an object to fit a shape?
Personally, I think that for this situation it would be best to round off the geometry in edit mode.  Especially since you will (presumably) be  modeling more details to the mesh such as windows, doors, tail, etc. you will want the mesh to be more contoured.

The way I would do this would be to use the smooth function and then tweak it a little with proportional editing.

To do this first go into edit mode and select everything, then bring up the specials menu with W and select smooth.  You can tweak the smoothing by going to the bottom of the left toolbar (T) or hitting F6.  I used the default smoothing value of 0.5, but increased the repeat value to 6.



Then I would tweak the mesh around using proportional editing, turn proportional editing on with O.  You can set the falloff curve in the footer of the 3D view and adjust the falloff radius with the scroll wheel.  You can go into wireframe view and line up your model with the background image to help with the tweaking process.

Here is what I came up with after a little tweaking.